Updated: Apr 19, 2020
A) - The delivery economy.
The path to excellence is a long and windy one. The idea of proliferating the brilliance of our industry via home delivery is nothing short of ‘eating the biblical apple’. The product is compromised, the magic is evaporated and the only winner is a multinational that leeches off our beautiful industry. A local delivery competitor just provides more smoke and validates the stupidity of the whole false economy.
Let me get this right. I sign up for the 4 cornerstones of cost (COGS,RENT, WAGES, TAXES) for the right to participate and compete in the AUSTRALIAN HOSPITALITY INDUSTRY. Then I get sucker punched into the idea that a restaurant experience can be enjoyed at home? Sound reasonable? What will this cost me? The answer is 30% of my gross sale price (incl. GST). This makes great business sense. I don’t even have a 10% margin already, but I fear my neighbour will sign in. I sign in and add more unprofitable sales to the turnover top line. I can’t miss out on this new economy and be left behind. I’m a new age guy and know how ‘to do’ social media. I can download an app. ‘All the kids are doing it, aren’t they?’. Food product quality, health and safety goes out the window. There is little regulation about how the food arrives and where it comes from. It may be produced in the restaurant kitchen that is represented on the ‘app’, but is equally likely to be produced in a ‘dark kitchen’ shipping container full of under supervised and under qualified, international workers. If you think UBER destroyed the Taxi industry, spare a thought for HOSPITALITY.
Competition is killing HOSPITALITY already with unqualified and unprofessional operators saturating our industry and competing on price. Home deliverers under cut and under mine our industry. We have been seduced into the idea that the internet and apps is the delivery mechanism of the future. It aint. Not on my watch.
B) - "No cash here. Here, no cash. Right Robbo?" Neville Bartos
One of the ‘pin ups’ of our industry was cash. We never talked about it. We never admitted that, maybe, we manipulated the cash takings to create false costs and false profits. We created our own margins such that there was an economy within an economy. It worked for a long time. It allowed us to sustain our industry, keep investing, keep employing, pay taxes and maybe have cash in our pocket. I’m not here to critique the legitimacy of this. The cash economy is dead and the carcass is the industry that relied upon it.
There is no cash anymore, literally. The veil has been lifted. The tap and go, credit card system creates complete transparency and underwrites the 4 cornerstones of cost and adds another, the cost of transaction. It also transfers the cost of credit to consumers and pushes people further into the credit trap, but that’s another story.
It’s time we all came clean. On takings and cost. There are only 100 cents in a dollar. Cash or not.